Netflix global subscriber growth disappoints; share price falls 15%
Global streaming giant Netflix has disappointed the market with its latest subscriber growth, adding just 1.7m new users compared with the 2.5m it had promised in the last quarter.
The news of slower than expected global growth saw the Netflix share price fall more than 15% in after-hours trading.
The market had expected Netflix to pick up an additional 500,000 subscribers in the US and 2m internationally; however, it gained just 160,000 new members in the US and 1.52 million members elsewhere, suggesting its home market penetration is stagnating.
Netflix partially attributed the challenges with growth to negative media coverage of an upcoming price rise in the streaming service, with CEO Reed Hastings noting that churn had recently increased.
Recode noted that Hastings had been very specific with his language, saying: “Churn ticked up slightly and unexpectedly, coincident with the press coverage in early April” and blaming it on the decision to “ungrandfather longer tenured members.”
In Australia, Roy Morgan has estimated the number of Australian subscribers at 1.87m, but senior industry figures had previously questioned the veracity of those numbers.
